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This week in ESG
Chinese renewable success, Blackrock’s ESG retreat, and cutting-edge emissions tracking from space.
Key highlights
🚪 Goldman Sachs bows out of CA100+ – following in the footsteps of JP Morgan, State Street and PIMCO, Goldman Sachs exits the Climate Action 100+ investor engagement group, citing US political pressure.
🎯 China smashes renewables target six years early – China hit its clean energy goal way ahead of schedule, reaching 1,206 gigawatts of capacity in July, surpassing Xi’s target to reach 1,200 gigawatts by 2030.
📉 BlackRock’s ESG support hits new low – support for environmental and social shareholder proposals fell in 2024, dropping to just 4.1%, down from 6.7% in 2023 and 47% in 2021.
🛰️ New satellite targets methane leaks – non-profit Carbon Mapper launched a satellite to track methane and CO2 super-emitters within 50 meters of their source – hoping to increase accountability and transparency in corporate reporting.
Chart spotlight
Passive fund manager climate support.
Source: Parmenion, August 2024.
We complete regular analysis into the continued suitability of funds within our Passive investment solutions, including an annual ESG assessment of fund managers. The chart above highlights the percentage of shareholder climate votes supported by these managers since 2021, broken down between US and rest-of-world (primarily European) fund houses.
Note: Geode run Fidelity’s passive mandates.
Why this matters
The above chart shows the stark difference in absolute support for shareholder climate votes, and the direction of travel, between US and European managers. In Europe, investor support for ESG remains not only strong but growing, with fund manager voting clearly reflecting the trend. In contrast, US managers show much weaker support, and it’s declining each year. The difference is largely due to the ongoing politicalisation of ESG and climate issues in the US, where some states have even boycotted fund houses, they see as too climate-focused, pressuring managers to water down their climate commitments.
ESG remains a crucial element of our Passive manager monitoring, with climate support being just one factor in our provider assessments. For our dedicated Passive ESG solution, the lack of climate support from US managers was a key reason behind our decision to work solely with European houses Amundi and UBS, although we continue to keep this under review.
This article is for financial professionals only. Any information contained within is of a general nature and should not be construed as a form of personal recommendation or financial advice. Nor is the information to be considered an offer or solicitation to deal in any financial instrument or to engage in any investment service or activity. Parmenion accepts no duty of care or liability for loss arising from any person acting, or refraining from acting, as a result of any information contained within this article. All investment carries risk. The value of investments, and the income from them, can go down as well as up and investors may get back less than they put in. Past performance is not a reliable indicator of future returns.